• Volume sales of chocolate confectionery have flattened in developed markets but continue to grow in emerging markets

• Sourcing remains an issue and although Côte d’Ivoire is still the top cocoa producer, allegations of unfair labor practices and damaging exploitation of the country’s eco system have cast a pall on the country’s cocoa industry

• The major better-for-you attribute of chocolate confectionery focuses on psychological wellbeing, and as a “treat food” the category is finding that it has to compete with a range of other categories

In 2015, established chocolate confectionery markets in Europe and North America saw volume sales flatten and per capita consumption falter as consumers may be looking across a wider range of indulgence products to satisfy their urge for sweets. While chocolate confectionery still has a strong role as a product that does not require “better for you” (BFY) tags to make it acceptable, it seems that consumers may be indulging, but with less abandon than seen in prior years.

Volume sales in the US and UK were flat between 2014 and 2015. And, among the strongest confectionery markets such as the US and UK, per capita consumption has stalled, down 0.3% in the US and 0.5% in the UK. In emerging markets, on the other hand, there have been increases in volume sales: in China, for example, volume sales increased 6% between 2014 and 2015, while in India, they grew 14% and in Indonesia 11%. Per capita consumption in these countries was also up, growing 13% in India, 10% in Indonesia and 6% in China.

Cocoa sourcing continued to be a big issue in 2015; after having come through the ebola epidemic in Africa relatively unscathed, Côte d’Ivoire remains the world’s biggest cocoa grower, but the country has come under scrutiny both for its labor and its growing practices. Ongoing litigation in the US around child slave labor in Côte d’Ivoire, which brings to light supposed unfair behavior by major manufacturers, will continue to make headlines in 2016 as a number of cases continue to wend their way through the American justice system.

At the same time, interest in origin and heirloom varieties have led to a growth in production in other cocoa lands; while the Americas and Oceania cannot produce enough cocoa to prove to be a threat to Africa, they are opening up opportunities that are likely to find resonance with sophisticated chocolate buyers who would rather spend more for a small amount of curated, unique chocolate than to spend less, but eat more, mass market product.

Over the past year, there have been some studies that have focused on potential BFY ingredients in chocolate, but consumer attitudes suggest that chocolate is a product whose BFY attributes focus more on psychological than physical wellness. While chocolate confectionery does well as a treat food, it is forced to face off against a range of other categories with the same reputation.

Figure 5: Global market performance, chocolate confectionery

Note: The size of each bubble represents the respective size of the market in volume

Source: Statistics Canada, NBS, Destatis, The Ministry of Internal Affairs and Communications of Japan, Chocolate and Cocoa Association of Japan, ASCHOCO, Convenience Store Petroleum, The Association for Convenience & Fuel Retailing, National Confectioners Association, General Statistics Office of Vietnam (GSO), MAGRAMA, InfoScanCensusTM, IRI España, Information Resources, Inc., The Nielsen Company, Economist Intelligence Unit/Mintel

* please note: the market size data referenced in this report is current as of January 31, 2016